Thursday, April 7, 2011

Chesapeake 2011 April Investor Presentation

Panoro Energy 2011 April Corporate presentation

Baytex Energy 2011 First East Coast Energy Conference

ARC Energy Trust 2011 April Investor Presentation

KMG EP 2011 Investor Relations presentation

ConocoPhillips increases 2011 capital budget by $2.5 billion to $16 billion!! ConocoPhillips to venture in to GoM, shale areas and Angola.

ConocoPhillips intends to target shale gas and deepwater acquisitions as part of the company's current asset management program. The company will increase planned capital spending of $13.5 billion by $2.5 billion for 2011 for favourable opportunities, the Gulf of Mexico in particular. Conoco is also looking at deep-water prospects off the coast of Angola. Shale assets are being sought in the US, Canada, eastern Europe (Poland) and China. ConocoPhillips’ chief executive Jim Mulva said, “The Company has its sights set on shale plays outside the key Marcellus and Eagle Ford regions”.

Why is ConocoPhillips on shopping spree?? May be these reasons-
  • Steady increase in oil price which is reaching approximately $120/barrel, the highest since July 2008 when it had hit $147/barrel
  • Unconventional fever is spreading across US, Canada, Europe and China. Recently, the Asians- in particular Chinese are striking back to back deals in US/Canada shale areas. Then, why not the US supermajor?? To make use of the robust oil price season, is ConocoPhillips looking at Bakken and Niobrara plays, if they are looking at the plays outside Marcellus and Eagle Ford.
  • Angola- Possesses similar characteristics to the pre-salt play located offshore Brazil. Many companies are active in exploring this pre-salt play in Angolan waters including Cobalt International, which is the operator of three blocks. Other operators that were awarded blocks by the Angolan government include Statoil, Total and BP. So, even ConocoPhillips may like to step into Angola.

Below are the significant deals in Angola:

  • Post Macondo oil spill, the companies like Shell, Noble Energy and BHP Billiton have been issued drilling permits in the GoM. This shows that the situation is slowly recovering in GoM. This may be one of the reasons why Conoco is interested towards GoM.

Following are the GoM packages which may be attractive to ConocoPhillips:

ConocoPhillips, currently being focused onshore US and Canada, wants to establish the company as a diversified player stepping into new areas like GoM, Angola, China, Poland, etc.,

Chesapeake’s “25/25” plan for 2011-2012; Plan to increase hydrocarbon production by 25% and to reduce long-term debt by 25% over 2010

Chesapeake, currently the number two producer of natural gas in the US and number one natural gas driller with respect to activity also has made a major change to its business strategy. The company is planning a two-year (2011-12) hydrocarbon growth rate of 25%, net of asset sales (reduced from prior target of 30 - 40%). The company is planning to increase liquids production by ~190% and natural gas production by ~6%. Expected hydrocarbon production in 2011 is ~3.065 bcfepd and 2012 is ~3.560 bcfepd.

Chesapeake deals in 2011 as part of implementing “25/25” plan:

Chesapeake and CNOOC formed a JV for the Niobrara Oil Shale, whereby CNOOC owned 33.3% undivided interest in Chesapeake’s 800,000 net oil and natural gas leasehold acres in the Denver-Julesburg (DJ) and Powder River Basins in northeast Colorado and southeast Wyoming.
Source: Derrick Petroleum E&P Transactions Database

Chesapeake sold all its interests in Fayetteville Shale, Central Arkansas to BHP, including $500 million for midstream interests for $4.75 billion.

Announced details of near-term asset monetization plans which might exceed pre-tax proceeds target of $5.0 billion

- Plan to monetize 25.8% equity investment in Frac Tech Holdings LLC
- Plan to monetize 20.0% equity investment in Chaparral Energy, Inc.
- Plan to use sale proceeds to retire $2.0 - $3.0 billion of senior notes and to also reduce bank credit facility borrowings

Sonatrach to develop the Algerian unconventional resources.......ENI likely to partner

Sonatrach will launch a pilot project for developing unconventional gas resources in 2012 in Algeria.

According to company sources, Sonatrach is ready to go in to it alone if they don’t find a partner. Algeria supplies about 20 per cent of Europe's natural gas , but Algeria has under-invested in new oil and gas projects. It normally takes between five and eight years for shale gas projects to come on line. Sonatrach plans to invest US$46 billion in upstream activity in the medium term.
ENI to partner

ENI is looking into Algeria's shale gas opportunities, an executive at the Italian company said Wednesday, making it one of the first international companies to signal its interest for North Africa's unconventional resources.

The interest is also part of a broader strategic diversification within ENI. In December, it entered the European shale gas market with an acquisition in Poland.

ENI has entered shale gas development projects in Poland and the United States. The company has agreed to develop shale gas opportunities with China's PetroChina. It has said it is looking into unconventional resource development in North Africa.


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